Wix raises $1 billion in oversubscribed convertible notes offering

Israeli company Wix is adding $1 billion to its cash reserves following the completion of a fundraising round through the issuance of convertible senior notes. The notes, which carry zero interest, are set to be converted into shares by 2030.

The offering was heavily oversubscribed, prompting Wix to increase the size of the fundraising from $750 million to $1 billion. The total could climb by an additional $150 million if participating investors, primarily large U.S. institutional entities, exercise an option granted to them.

Wix headquarters.

The deal comes just a week after Nova, an Israeli company that develops systems for chip manufacturing, also received strong demand for a similar issuance. Nova had planned to raise $500 million but ultimately secured $650 million through its convertible notes offering. Like Wix’s deal, Nova’s notes can be converted into shares under certain conditions linked to the stock price over the coming years, and they pay no interest to holders.

Convertible notes are a common fundraising mechanism for technology companies listed on Wall Street. They allow firms to raise capital without causing immediate dilution of existing shareholders, effectively combining the features of notes with an option on the stock. The structure also provides flexibility, since the fundraising is not directly tied to the current share price.

That flexibility is particularly relevant for Wix, whose shares have fallen about 30% since the beginning of the year, leaving the company with a market capitalization of around $8 billion. Nova, in contrast, has seen its shares climb nearly 40% this year, reaching a record valuation of $8 billion.